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1Q10 Earnings ReleaseMay 14th, 2010BRProperties
BRProperties 1Q10Highlights- 2 -FinancialHighlightsOperationalHighlights Finalized the acquisition of seven remaining pro...
BRProperties 1Q10Recent Acquisitions- 3 - On January 22nd, 2010, we acquired “DP Araucária”, a distribution parklocated i...
BRProperties 1Q10Recent Acquisitions- 4 - On April 12th, 2010, we acquired for the amount of theR$180.0 million, the offi...
BRProperties 1Q10Portfolio- 5 -Portfolio Growth (GLA sq m)Portfolio Breakdown (% market value) Portfolio Breakdown (% GLA)...
BRProperties 1Q10Case Study- 6 -ROE*: 147%Sale Value AdditionHenrique SchaumannAcquisition Value R$ 41.0 mmAcquisition Dat...
BRProperties 1Q10- 7 - Financial Vacancy of 8,3% in 1Q10; Excluding the TNU building, acquired in march, ourfinancial vac...
BRProperties 1Q10- 8 - In the quarter, we renegotiatedexisting leases and signed newleases in vacant areas with anaverage...
BRProperties 1Q10- 9 -Operational Highlights Addition of three new properties under our management, which is performed by...
BRProperties 1Q10- 10 -Financial HighlightsNet Revenues Adjusted EBITDANet Income FFO27.28141.60052.8741Q09 1Q10 1Q10 Pro ...
BRProperties 1Q10Pro-Forma EstimatesAdditional Pro-forma Gross Revenues(non audited)Adjusted EBITDA(non audited)- 11 -Meth...
BRProperties 1Q10- 12 -Financial HighlightsExpected Positive Effects of the Growthof Inflation Indexes(TR vs. Inflation)Ef...
BRProperties 1Q10Debt42.008 48.31263.496 56.65077.812 72.846 81.006221.81837.90424.0252.738 1.0272010 2011 2012 2013 2014 ...
BRProperties 1Q10GlossaryEBITDA (Earnings Before Income, Tax, Depreciation and Amortization): a non accounting measure whi...
BRProperties 1Q10IR ContactsInvestor RelationsPedro DaltroCFO & Investor Relations OfficerLeonardo FernandesInvestor Relat...
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  1. 1. 1Q10 Earnings ReleaseMay 14th, 2010BRProperties
  2. 2. BRProperties 1Q10Highlights- 2 -FinancialHighlightsOperationalHighlights Finalized the acquisition of seven remaining properties from 2009: DP Araucária, five warehousesat Brazilian Business Park, and Nações Unidas Tower, for the amount of R$ 322 million The number of properties managed by the Company increased from 23 in 1Q09 to 27 in 1Q10 Our revenues from services rendered grew by 98% in 1Q10 compared to 1Q09 Real growth of 5.4% in value of new leases/renegotiations in the 1° Quarter of 2010 Gross Revenues increased by 52% compared to 1Q09 Adjusted EBITDA, excluding stock option plan expenses and bonus provision, of R$ 35.5 million atthe end of 1Q10, an increase of 53% compared to 1Q09 Pro-forma EBITDA of R$46.8 million in 1Q10, with an EBITDA Margin of 88% Net Profit of R$11.8 million, an increase of 68% over 1Q09RecentEvents In April, we acquired the office building “Ed. Jacarandá”, with approximately 32,000 sqm of GLA forR$180.0 million. The building was recently developed, and is already leased to Philips andRedecard. Also in April, we acquired another 4 industrial warehouses in Louveira/SP for R$181.0 million.These warehouses reinforce the Company’s presence in the region, where we own over 250,000sqm of GLA. At the moment, we have already acquired 25% of the acquisitions outlined in the capital budget
  3. 3. BRProperties 1Q10Recent Acquisitions- 3 - On January 22nd, 2010, we acquired “DP Araucária”, a distribution parklocated in the city of Araucária/PR, for the amount of R$69.9 millionProperty Overview:GLA: 42,697 sq m% Acquired: 100%# Warehouses: 1100% leased On February 26th, 2010, we concluded theacquisition of “Brazilian Business Park” for R$101.2millionProperty Overview:GLA: 59,182 sq m% Acquired: 100%# Warehouses: 5100% leased On March 16th, 2010, we acquired the office building “Torre NaçõesUnidas”, located in the Marginal do Rio Pinheiros region for R$151.2millionProperty Overview:GLA: 25,555 sq m% Acquired: 100%# Floors: 18Under retrofit, currently 50% leasedBrazilian Business ParkDP AraucáriaTNU
  4. 4. BRProperties 1Q10Recent Acquisitions- 4 - On April 12th, 2010, we acquired for the amount of theR$180.0 million, the office building “Edifício Jacarandá”,located in the Castelo Branco Office Park.Property Overview:GLA: 31,954 sq m% Acquired: 100%# Floors: 14Recently developed – 50% leased to Philips and Redecard On April 20th, 2010, we concluded theacquisition of 4 logistics warehouseslocated in the “DP Araucária” complex,where BR Properties already owns 2other warehouses. The acquisition valuewas of R$181.0 million.Property Overview:GLA: 106,306 sq m% Acquired: 100%# Warehouses: 4100% leasedCBOP – Ed. JacarandáDP Louveira 3, 4, 5 & 6
  5. 5. BRProperties 1Q10Portfolio- 5 -Portfolio Growth (GLA sq m)Portfolio Breakdown (% market value) Portfolio Breakdown (% GLA)51%46%4%Office Industrial Development25%75%Office Industrial646.055730.558868.80759.182(235)25.55531.954106.306Portfolio atIPOAcquisition ofBBPSale ofIsabela (cj.41)Acquisition ofTNU1T10 Acquisition ofEd. JacarandáAcquisition ofDP Louveira3-6CurrentPortfolio
  6. 6. BRProperties 1Q10Case Study- 6 -ROE*: 147%Sale Value AdditionHenrique SchaumannAcquisition Value R$ 41.0 mmAcquisition Date Nov/07Re-tenanting R$ 6.5 mm / year (42%increase on rental income)Retrofit Elevators/ Façade/Parking2009 Appraised Value R$ 78.0 mmEd. GeneraliAcquisition Value R$ 16.6 mmAcquisition Date Aug/07Sale Value R$ 21.5 mmSale Date Jan/10Holding Period 29 monthsIRR 36%* Before taxes41,078,026,9738,10-5,0010,0015,0020,0025,0030,0035,0040,0045,0010,020,030,040,050,060,070,080,090,0At Acquisition CurrentProperty ValueLease/sq m16,621,5Acquisiton Value Sale Value
  7. 7. BRProperties 1Q10- 7 - Financial Vacancy of 8,3% in 1Q10; Excluding the TNU building, acquired in march, ourfinancial vacancy was 4.1%Operational HighlightsVacancy Breakdown7,3%6,0%4,7%6,9%8,3%4,1%2009 1Q10 1Q10 Ex - TNUPhysicalFinancial Despite the recent increase in the vacancy rate, the prospect of leasing the vacant areasis very positive given the forecast economic growth We expect our vacancy rate to return to its historic low levels in the short term
  8. 8. BRProperties 1Q10- 8 - In the quarter, we renegotiatedexisting leases and signed newleases in vacant areas with anaverage real gain of 5.4%32%34%16%10%8%2010 2011 2012 2013 >201321%40%25%13%1%2010 2011 2012 2013 >201369%28%3%1Q09IGP-MIPCAOutros81%15%5%1Q10Lease Contract Readjustment IndicesLease Contract Expiration Schedule(# of contracts)Lease Contract 3 Year Renegotiation Schedule(# of contracts)Operational Highlights
  9. 9. BRProperties 1Q10- 9 -Operational Highlights Addition of three new properties under our management, which is performed by oursubsidiary, BRPR A Administradora de Ativos Imobiliários Ltda.Managed Properties BRPR A Revenues23271Q09 1Q104288491Q09 1Q10
  10. 10. BRProperties 1Q10- 10 -Financial HighlightsNet Revenues Adjusted EBITDANet Income FFO27.28141.60052.8741Q09 1Q10 1Q10 Pro Forma52%27%23.21035.47946.7531Q09 1Q10 1Q10 Pro Forma53%32%85% 85% 88%Adjusted EBITDA Margin11.13716.6371Q09 1Q1049%7.01611.7591Q09 1Q1026%28%Net Margin68%
  11. 11. BRProperties 1Q10Pro-Forma EstimatesAdditional Pro-forma Gross Revenues(non audited)Adjusted EBITDA(non audited)- 11 -Methodology Considers that the Company’s current revenueswere incurred from January 1st 2010, until March31st 2010Results Our pro forma gross revenues totaled R$58.6million, 27% above 1Q10 Our adjusted EBITDA pro-forma margin was 88%,3% above the 85% margin attained in the period46.19858.6215002.923 1.3122.5925.0961Q10ActualDPAraucáriaBBP TNU CBOP Louveira 1Q10 Pro-forma27%35.47946.75385%88%80%81%82%83%84%85%86%87%88%89%90%25.00030.00035.00040.00045.00050.00055.0001Q10 Actual 1Q10 Pro-formaAdjusted EBITDA Margin
  12. 12. BRProperties 1Q10- 12 -Financial HighlightsExpected Positive Effects of the Growthof Inflation Indexes(TR vs. Inflation)Effects of the NominalInterest Rate Increase(SELIC vs. TR)8,75%12,00%0,82% 0,97%0,0%2,0%4,0%6,0%8,0%10,0%12,0%14,0%2009 2010eForecast SELICTR The potential increase in the nominal interest rate until the end of the year would result in a smallincrease in the TR, main index that readjusts or financing contracts The inflation increase, on the other hand, would have a positive effect on the Company’s results, giventhat 100% of our lease contracts are indexed to inflation rates Our cash reserves are invested exclusively in bank notes indexed to the Brazilian inter-bank rate (CDI),which would cause an increase in our financial revenues with the forecast increase in the SELIC rate0,00%7,95%0,82% 0,97%0,0%1,0%2,0%3,0%4,0%5,0%6,0%7,0%8,0%9,0%2009 2010eBasket of lease contractinflation readjustmentindicesTR
  13. 13. BRProperties 1Q10Debt42.008 48.31263.496 56.65077.812 72.846 81.006221.81837.90424.0252.738 1.0272010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021Net Debt 90Cash 698Debt Amortization ScheduleShort Term Debt 92Obligations for Acquisitions 58Long Term Debt 637Total Debt 788Shareholders Equity 1.664Balance Sheet 1Q1090,1%5,1%4,8%TRIGPMCDIDebt Breakdown- 13 - Comfortable amortization schedule in the next few years, with low refinancing risk
  14. 14. BRProperties 1Q10GlossaryEBITDA (Earnings Before Income, Tax, Depreciation and Amortization): a non accounting measure whichmeasures the Company’s capacity to generate operational revenues, without considering its capital structure.Measured by excluding the operational expenses from Gross Profit and adding back the depreciation andamortization expenses for the period(Gross Profit – General and Administrative Expenses + Depreciation + Amortization)Adjusted EBITDA: adjustments made to EBITDA by excluding R$ 0.2 million from expenses regarding theCompany stock option plan, along with R$ 1.2 million in employee bonus provisionsFFO (Funds From Operations): non accounting measure, which adds back depreciation to net income in orderto determine, utilizing the income statement, the net cash generated in the period(Net Income + Depreciation)Vacancy - Financial: estimated by multiplying the average rent per sqm which could be charged in the buildingsand their respective vacant areas, and then dividing this result by the potential gross revenues of eachproperty. Indicates the percentage of potential revenue which is lost each month due to vacancyVacancy - Physical: estimated by dividing the total vacant area by the total GLA of the portfolio- 14 -
  15. 15. BRProperties 1Q10IR ContactsInvestor RelationsPedro DaltroCFO & Investor Relations OfficerLeonardo FernandesInvestor Relations ManagerMarcos OliveiraInvestor Relations AnalystPhone: (55 11) 3201-1000Email: ri@brpr.com.brwww.brpr.com.br/ri- 15 -
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